This Tech Company is More Profitable than Apple

Samsung edged past Apple to become the most profitable tech company in the second quarter, but there’s a twist. Samsung will likely supply flexible displays to a new version of the iPhone, and to keep up its profitability, Samsung may want Apple to sell as many of the phones as possible. Jacky Wong writes at The Wall Street Journal:

Still, strong sales of the newest iPhone model, expected later this year, could actually benefit Samsung. The Korean company will supply flexible displays, called organic light-emitting diodes, to at least one version of the new phone, The Wall Street Journal has reported. Samsung currently owns nearly the whole market for mobile OLEDs. Apple probably wants to source from other suppliers—like Korea’s LG Display—as well, but supply from such companies won’t likely come until late next year.

Even though Samsung supplies memory chips to Apple as well, the business accounts for less than 5% of the company’s operating profit, Credit Suisse estimated. The more salient impact from the so-called iPhone “supercycle,” as some analysts call it, is that it will likely keep memory chip prices buoyant.

While Samsung and Apple are sometimes depicted as arch rivals, their relationship is actually one of mutual benefit right now.